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Issues:
- Appeal against orders of Appellate Assistant Commissioner under Tamil Nadu General Sales Tax Act, 1959 for assessment years 1973-74 and 1974-75. - Disputed turnover of cotton and hair beltings for exemption from sales tax under Item 4 of the Third Schedule. Analysis: 1. Background: The appeals were filed against the orders of the Appellate Assistant Commissioner (Commercial Taxes)-I, Madras under the Tamil Nadu General Sales Tax Act, 1959, for the assessment years 1973-74 and 1974-75. The appeals were related to the disputed turnover of cotton and hair beltings. 2. Assessment Details: The assessee, a dealer in rice huller and flour mill machineries, faced revised assessments for the years in question. The turnover of sales of hair beltings and cotton beltings was disputed, leading to the appeals. The assessing officer disallowed exemption claims on these items, resulting in higher taxable turnovers for the appellant. 3. Grounds of Appeal: The grounds in both appeals focused on the exemption of cotton and hair beltings from sales tax under Item 4 of the Third Schedule. The contention was that these beltings should be exempt based on the composition and certification provided. 4. Legal Interpretation: The key issue was whether cotton and hair beltings fell under the exemption criteria of Item 4 of the Third Schedule. The relevant provisions of the Central Excise and Salt Act, 1944, were examined to determine the applicability of the exemption to these beltings. 5. Exemption Criteria: The Third Schedule exempted certain fabrics from tax, including cotton fabrics. The assessee provided certification showing the composition of the beltings, with a significant cotton content. The analysis focused on whether these beltings fit the definitions under the Central Excise and Salt Act for exemption. 6. Interpretation of Definitions: The definitions of cotton fabric and woollen fabric under the Central Excise and Salt Act were crucial in determining the exemption status of cotton and hair beltings. The notification and special importance of cotton fabrics in inter-State trade were also considered in the decision-making process. 7. Revenue's Argument: The Revenue argued that beltings were components of machineries and subject to tax. However, the specific provisions under the First Schedule did not clearly include hair belting and cotton belting. The lower authorities' justification for levying sales tax on these items was deemed incorrect. 8. Judgment: The Tribunal ruled in favor of the assessee, allowing exemption on the disputed turnovers of cotton and hair beltings. The appeals were allowed, granting the assessee exemption on specific turnovers for the respective years. In conclusion, the judgment favored the assessee by exempting the disputed turnovers of cotton and hair beltings from sales tax under the relevant provisions of the Tamil Nadu General Sales Tax Act, 1959.
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